California Property Taxes 2024: Rates, Calculations & Relief

California's average property tax rate will remain relatively low at 0.68% of a property's assessed value in 2025. Understanding these taxes can help you make informed decisions about buying, selling, or managing property and save money in the Golden State.

However, California's property taxes, with unique regulations and propositions, can seem complicated. That’s why we have this blog for you.

Local governments levy property taxes on real estate properties to fund public services. In California, property taxes are governed by Proposition 13. This rule sets a limit on the tax rate and controls how much the property cost can increase each year.

The California property tax rate is 1% of the property’s assessed value in addition to voter-approved local taxes and assessments. This limit is important as it ensures that property taxes remain predictable for you.

The California property tax rate is one of the most stable in the U.S. This stability is because of the regulations that limit the increase in tax rates and property assessments. The base tax rate is 1% of the property's assessed value. However, additional local taxes and assessments increase the total tax rate.

For example, in Los Angeles County, the average property tax rate is approximately 1.16%. Of this, 1% is the base tax of the property value, while the remaining 0.16% is local taxes.

You can use a California property tax calculator to find out how much property tax you need to pay. This will play a critical role in your property’s assessed value and local taxes.

Proposition 13 is a landmark law passed in 1978. It significantly affects property taxes in California.

This law:

• Limits the property tax rate at 1% of the assessed property value.

• Restricts annual increases in assessed value to 2%.

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Property taxes in California are calculated based on the assessed value of your property. The estimated value is determined at the time of purchase of the property. This can only increase by 2% annually under Proposition 13.

Here’s a simple way to calculate property tax:

• Assessed Value: This is usually the purchase price of your property (e.g., $500,000).

• Base Tax Rate: 1% of the assessed value.

• Local Taxes/Assessments: Additional taxes vary by area, usually for local services or bonds.

Example:

Imagine you purchase a home in California for $500,000:

Base Property Tax:

• $500,000 × 1% = $5,000 annually

Local Taxes/Assessments:

• Local voter-approved taxes add approximately $600–$1,000 annually. It depends on your area.

So, your total property tax would likely be $5,600–$6,000 annually.

This calculation gives you a clear idea of what to expect when budgeting for property taxes.

California offers several property tax exemptions and relief programs. These include:

• Homeowner’s Exemption: It reduces the assessed value of a primary residence by $7,000. This helps to save you about $70 annually.

• Senior Citizen Property Tax Postponement Program: This allows senior citizens to postpone property taxes. This is done after they fulfill income and equity requirements.

• Veterans’ Exemption: It is available to veterans with disabilities. It provides additional tax relief. For the 2025 assessment year, the basic exemption amount is $175,298.

Property tax rates can vary by county. This is due to local assessments and voter-approved measures. Here’s a quick overview:

Use a California tax estimator to get precise figures for your county.

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Proposition 13 caps the increase annually in assessed value. However, property taxes can rise in California due to:

• Local Bond Measures: Voter-approved initiatives for schools, parks, and infrastructure. These measures are necessary to fund community welfare.
• New Construction: It adds value to the property. As a result, the property is reassessed at a higher value, leading to higher taxes.
• Ownership Changes: Reassessment of the current market value, which often increases the tax base. This ensures that the new owner pays taxes aligned with the property’s updated worth.

You should consider these strategies to reduce your property taxes:

• Claim Exemptions: You should ensure that you’ve applied for all eligible exemptions. One example is the Homeowner’s Exemption.
• Appeal Assessments: You should file an appeal with your county assessor if you believe your property is overassessed.
• Avoid Major Renovations: Home improvements can lead to a reassessment.
• Check Tax Bills: Learn how to read a property tax bill to identify any errors or overcharges.

Failing to pay property taxes can have serious consequences. Some of them are:

• Delinquent Penalties: Unpaid taxes will lead to penalties. This is typically 10% of the unpaid amount.

• Tax Lien: A tax lien is also recorded against the property, which makes it difficult to sell or refinance until the debt is cleared.
• Tax Auction: If property taxes remain unpaid for five consecutive years, the county has the right to sell the property at a tax auction to recover the unpaid taxes.

It is important to understand property taxes in California, as they control your homeownership journey. You must stay informed, regularly review property tax bills, and take advantage of available exemptions.

Home values and realtor fees already make buying a property expensive. The property taxes you’ll pay yearly add an extra financial burden. While you can’t avoid property taxes, you can eliminate realtor commissions with reAlpha.

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Use a California property tax calculator by mentioning your property’s assessed value and location-specific rates.

The base property tax rate is 1%. But local taxes and assessments can add 0.1%–0.3%. This depends on the area.

Property taxes fund essential services like schools, public safety, and infrastructure, benefiting the community.

Now is the best time to buy a house in California. This time of the year has the lowest inventory. Savvy buyers can take advantage of this and buy homes at better prices.

Save Big when you Buy a Home with reAlpha!

Discover how our all-in-one homebuying platform can increase your buying power and put money back in your pocket. Start your journey today!

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